UK spread betting, Spreadex becomes the second regulated broker to begin offering bitcoin trading in the form of a spreadbet yesterday. (Props go to Forex Magnates reader Jason Smith on alerting us about the broker). The volatile offering allows for both long and short selling, but does have its share of restrictions. Currently, trades are only available by phone, with spreads of 2.5%, and only 2:1 leverage. Additionally, placing stop orders in unavailable. Those are some hefty restrictions, but we imagine that they will loosen up as more firms enter the market.
Plus500 was the first broker to announced leverage trading last week (although there are conflicting opinions on whether it is available for live accounts). Like Plus500, Spreadex is a little known firm in the world of FX trading. So who is Spreadex? Spreadex is an UK regulated FCA firm who offers both sports and casino betting and financial trading, having acquired different brands over the years including the account book of MF Global Spreads in 2012. The firm currently offers accounts to both UK and non-UK customers with the exception of the US and Turkey. Unlike many other brokers, Spreadex doesn’t provide free demo accounts. Therefore users will need to open a live account (but can leave it unfunded) to see their platform.
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To learn more about their offering Forex Magnates reached out to Spreadex. Answering why they launched bitcoin trading, a spokesperson from Spreadex said “We had received requests from a number of clients asking if we were considering offering leveraged trading on the price movements of Bitcoin. Our traders have been looking into the possibility of offering the market to sit alongside our other extensive list of markets, and we have now offered the market via phone trading access only.”
Additionally, in relation to how order flow,will be handled and where the price is being derived, it was answered “Currently we’re making our own market, taking clients’ positions onto our book. But in the event we decided to hedge, we would look to use established exchanges where necessary.” Also, they added that they are using MtGox pricing to establish their spreads.